St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1887-12-31

panies for fifty years, on certain terms.
| The testimony shows that, except the
| Union Pacific, none of these companies
| have agreed to, or will or can accept the
| terms recommended by the majority.
| The fact is. that as to all the companies
| except the Union Pacific, their bank
| ruptcy is so complete and irretrievable
| that no part of their indebtedness can
ever be recovered by the government
except by immediate compulsory legal
process. Extension of time for pay
ment, therefore, means in reality but an
increase of the amount of the debt and
the making OF its recovery the more
hopeless.
OBJECTIONS TO EXTENSION.
'The objections to an extension of
the time of payment of the debt of the
Union Pacific are many and insuper-
able, and were strongly urged upon the
commissioners when testimony was
taken in Kansas, Nebraska and Colo
RADIO. The Union Pacific company has
received S176. 294, 1883 in surplus earn
ings and land sales during eighteen
years, and if its stock had been fully
paid, as congress required that it should
be, and as its officers certified under
oath that it was, nearly all of that money
would be applicable to-day to the
pay VI tuC ucDt.
The company has paid out $685.
$780, in dividends, and $50, 49,
S56.2S in interest on bonds, nearly
all of which were distributed to share
holders without consideration; it has
sunk over S10.000,000 in the Denver,
South Park & Pacific; it paid out S1O,-
100000 to Jay Gould and his associates
for branch lines and other investments
which were worthless, and which were
unlOaded upon the Union Pacific be-
cause of the faithlessness of the man.
agement of the company. What asSur-
ance, then, can there be that the COM
pany in the future will pay any greater
heed to the obligations imposed upon it
past. The gross mismanagement
of the Union Pacific and the
other Pacific railroads has not only in
jured the credit of American railroads
among investors in this country, but it
has shaken the faith of foreign investors
to such an extent that hundreds of mil.
lions of dollars, which otherwise would
have been sent here for investment and
aided in the development of the cOun.
try, have been locked up abroad. The
foreign investor looked upon these Pa
cific railroads as being under govern
ment auspices. They received gov
lOdu, GuCl dlluudl It.
ports to the government, and, in addi
ton to these requirements, the govern.
ment had representation of five di.
rectOrS in the Union Pacific manage.
ment. The good faith of the country.
was, therefore, presumed to be back of
these Pacific railroad securities.
A TAX OF s., 000, COO A YEAR FOR FIFTY
YEARS.
''The present capitalization and in
debtedneSS of the Union Pacific railway
represents triple the cost of its repro
ductiOn. To extend the debt is to place
a mortgage upon the earnings and upon
the products of the people of Kansas.
Nebraska and Colorado, not only of this
but of succeeding generations. Why
should the Ubiquitous results of the
Credit Mobilier be made bur-
denSome exaction upon the genera
lions that come after it? To extend
the debt is to perpetuate the eXtOr-
tiOnate rates of transportation which
are now charged by the Union Pacific
for the maintenance of its present in
f1ated capitalization. Why should the
communities of the great West be
forced to pay rates that will perpetuate
this enormous burden of fictitious and
fraudulent Indebtedness? To continue
the Union Pacific in its present cOndi-
IiOll 10 W lOlCG bHC hulClI 10
tributary to that line to pay fixed
charges of S9,000,000 per annum, eXclu-
sive of dividends to stockholders.
FORFEITURE OF CHARTER.
The extension being unwiSe and inn
practicable, there is only one course
open to congress, and that is an immedi-
ate winding up of the affairs of all he
companies, enabling the government to
withdraw at once from all connection
with the running of railroads, or Shar-
ing in the profits of their management.
There ought to be an end to the partner
ship between the government and the
Pacific railroads; a speedy and absolute
divorce. The only method by which this
result can be reached is that which was
suggested by Justice Hunt in the Credit
MObilier cases. 1t is the alternative
pointed out by the Wilson committee of
congress in the event of the failure Of
the equity proceedings in the United
States courts. 1t is the course that con-
gress directed the attorney general, by
resolution of April 10, 1869 (Section ~,
to take against the Union Pacific, that
is, the forfeiture of the charter.
ANTICIPATING a DEFAULT.
The beginning of proceedings at tbs
time to cause the forfeiture of the char
tiers of these companies because Of their
violation of law and failure to keep
their contracts with the government, is
only to anticipate by few years the re-
suit which will be inevitable when the
bonds mature in 1895 and 1897. 1t should
he borne in mind that it is fact adj
mitted by every officer of these roads
who testified before the commission,
and overwhelmingly proved by the evil
dence submitted, that the payment OF
the debt at maturity, in 1895 and 1897,
can under no circumstances be eX-
pected.